Main Home

AAA

DEFINITION of 'Main Home'

A term used by the Internal Revenue Service (IRS) to define the home a taxpayer has lived in most of the time during a given taxation year, or the only home a taxpayer owns. The classification of a taxpayer's main home is important when considering gains resulting from the sale of a main home.

INVESTOPEDIA EXPLAINS 'Main Home'

When you sell your home, you may be able to exclude the gains from your income for tax purposes if you pass the ownership and use tests. If over the previous five years you have owned the home for more than two years, and it was your main home for more than two years, then you can exclude up to $250,000 ($500,000 for joint filers) in a given tax year.

Losses resulting from the sale of your main home cannot be deducted.

RELATED TERMS
  1. Home Office

    An office located inside the taxpayer's home that serves as the ...
  2. Deferred Gain On Sale Of Home

    An obsolete tax law that applied to homeowners before May 7, ...
  3. Land Value

    The value of a piece of property, including both the value of ...
  4. Internal Revenue Service - IRS

    A United States government agency that is responsible for the ...
  5. Land

    Property or real estate, not including buildings or equipment, ...
  6. Vacation Home

    A dwelling other than the owner's primary residence that is used ...
RELATED FAQS
  1. My wife and I both converted our Traditional IRAs to Roth IRAs in Dec 1998 and have ...

    You and your spouse each qualify for a penalty-free distribution of up to $10,000 for the purchase, acquisition or construction ... Read Full Answer >>
  2. How is market value determined in the real estate market?

    Anyone who has ever tried to purchase or sell a home has probably heard a lot about the property's fair market value, or ... Read Full Answer >>
  3. What does the American Dream mean to different generations?

    The American Dream at its core is the belief that every generation should enjoy greater prosperity than the generation before ... Read Full Answer >>
  4. When should a real estate broker release earnest money deposit funds?

    As soon as an agent or broker accepts an earnest money deposit, he becomes an escrow agent. This means that, in most cases, ... Read Full Answer >>
  5. Why does the loan-to-value ratio matter?

    For mortgage lenders and borrowers, the loan-to-value ratio is an important factor in determining the repayment terms of ... Read Full Answer >>
  6. What is the difference between a PMI (primary mortgage insurance) loan and a Federal ...

    Home buyers who are unable to contribute a traditional down payment of 20% may think home ownership is out of reach. However, ... Read Full Answer >>
Related Articles
  1. Home & Auto

    Top Tips For First-Time Home Buyers

    Follow this step-by-step guide to make your homeownership dreams a reality.
  2. Home & Auto

    Cut Commissions With "For Sale By Owner" Sales

    It takes a lot more work, but selling your home without a realtor can have benefits.
  3. Taxes

    Vacation Home Or Income-Producing Investment?

    There is an alternative to letting your cottage sit empty all year, but turning a profit won't be easy.
  4. Budgeting

    Paring Down Moving Costs

    Unexpected costs can add to the stress of relocation. Plan ahead and anticipate what may pop up.
  5. Home & Auto

    When Is the Best Time for You to Buy a House?

    Making what is likely to be the single most expensive purchase of your lifetime shouldn’t be done on a whim.
  6. Investing

    Where Are Real Estate Stocks Heading?

    We summarize five economic reports that investors should monitor monthly to keep them informed of where real estate and its related stocks are heading.
  7. Home & Auto

    10 Things Your Real Estate Broker Won't Tell You

    Whether you're selling a home or buying one, go in with eyes wide open when you're working with a broker.
  8. Investing

    Find the Private Island of Your Dreams

    The perks, the problems and the pleasures of owning your own little piece of paradise.
  9. Investing

    Can I Afford To Buy A Private Island?

    It may not be as pricey as you think, but don't forget to pay attention to the rights you're buying and, perhaps, factor in the cost of building a house.
  10. Credit & Loans

    Smart Ways to Use a Mortgage Calculator

    When you're buying a home, it's essential to do due diligence about the true costs. Mortgage calculators will show you if you can afford the purchase.

You May Also Like

Hot Definitions
  1. OsMA

    An abbreviation for Oscillator - Moving Average. OsMA is used in technical analysis to represent the variance between an ...
  2. Investopedia

    One of the best-known sources of financial information on the internet. Investopedia is a resource for investors, consumers ...
  3. Unfair Claims Practice

    The improper avoidance of a claim by an insurer or an attempt to reduce the size of the claim. By engaging in unfair claims ...
  4. Killer Bees

    An individual or firm that helps a company fend off a takeover attempt. A killer bee uses defensive strategies to keep an ...
  5. Sin Tax

    A state-sponsored tax that is added to products or services that are seen as vices, such as alcohol, tobacco and gambling. ...
  6. Grandfathered Activities

    Nonbank activities, some of which would normally not be permissible for bank holding companies and foreign banks in the United ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!